They're both showing output for me.
I suspect in the course of doing your tests, you've been making a number of changes.
I also suspect that the bg has had instances running with the older versions of the same scripts at the time you was trying to change it, and it is still referencing the older version from the caches.
If you can't get it sorted out by either:
1) Stopping/removing the existing instances.
2) Putting the process into full draft mode
3) Updating the GEL
4) Validating/activating the process
5) Creating a new instance
-or-
Create a new a process and put the revised example1 script in there.
Then you may need to find a time when you get the bg services restarted.
Running the scripts from the command line (changing gel:log's to gel:out's) avoided those issues for me and showed no issue with it outputting the parsed XML variable in both cases.